The Knesset last night approved the first reading of a bill that comes to significantly increase the amount of compensation paid in libel suits. The bill passed its first reading by a vote of 42-31.

Opponents charge that the proposed law, which would allow libel victims to claim up to NIS 300,000 in compensation even without proving actual harm, could have a serious chilling effect on the press.

Currently, the compensation ceiling in libel suits is only NIS 50,000.

Prime Minister Benjamin Netanyahu backed the legislation, and the government imposed coalition discipline in the vote, requiring all coalition members to support it.

A few hours before the vote, Netanyahu told members of his Likud Knesset faction that "whenever I thought a legislative initiative was liable to harm democracy, I shelved it immediately, even if it had a sweeping majority.

"As long as I'm prime minister," he continued, "Israel will continue to be a strong, model democracy. No one will dictate what to think, what to write, what to investigate, what to broadcast. That isn't the Likud's way, or mine. But freedom of expression must be granted to every segment of the nation."

Kadima, in contrast, decided to oppose the bill unanimously, at the behest of its chairwoman, Tzipi Livni. At a faction meeting earlier in the day, Livni termed the bill - along with other proposals to revise the judicial appointments process and limit foreign contributions to "political" nongovernmental organizations - "an attempt to harm those entities that are the checks, balances and monitors of the government."

The legislation is a merger of two separate bills, one by MK Meir Sheetrit (Kadima ) and one by MK Yariv Levin (Likud ), and some Kadima MKs wanted to vote for it. But because the faction voted to oppose it, they instead paired off with MKs from Atzmaut (a coalition faction ) who opposed the bill, making a deal under which they excused themselves from the vote.

Both Sheetrit and Levin said on Monday that they planned to soften the bill significantly before it returned to the plenum for its final readings.

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